Gig workers’ security net: Code offers hope, but reality awaits

THE GIG ECONOMY in India has outpaced traditional forms of businesses, powered by delivery partners, drivers, technicians, creators and freelance professionals working with platforms and startups.

- ANSHUL PRAKASH & KRUTHI N MURTHY

For years, this workforce operated outside traditional labour protections. Until 21 November 2025, except in a few states, gig and platform workers had no formal entitlement to social security, minimum wages or protection from sudden disengagement.

The Code on Social Security, 2020 (Code), which has been brought into force, changes this landscape. It formally recognises gig and platform workers and authorises the Central and state governments to create schemes offering life and disability cover, accident insurance, health and maternity benefits, old-age protection and other welfare measures. Aggregators must contribute between 1 to 2% of their annual turnover, capped at 5% of the amounts paid to gig workers, to a dedicated social security fund. The framework is significant, but its practical impact will depend heavily on how the proposed schemes are structured and implemented.

Lack of clarity

The Code defines a “gig worker” as someone working outside a traditional employer-employee relationship, and a “platform worker” as a person performing services through an online platform. However, the Code does not clarify what “outside traditional employment” means. This lack of precision can lead to disputes about who is genuinely a gig worker and who may actually be an employee performing core functions under considerable control and supervision. Platforms with strong algorithmic oversight, performance ratings and penalties may blur the line between independent contractors and dependent workers, inviting inconsistent interpretations across industries.

Limited benefits and not equivalent to job